It would be term life insurance. Some advantages:

* Term life premiums are the lowest on the life insurance market, allowing younger customers to buy more coverage when they most need it. However, this is usually not the case over the full duration of the policy. Because premiums rise with each term policy renewal, the cost in later years will exceed the level premiums of a whole life insurance policy.
* Term insurance is the best solution for needs that will disappear with time, and when protection is needed for less than ten years. Financial advisers usually recommend that permanent life insurance is purchased if one needs protection for more than 15 years.
* Young people can buy considerable face amounts at very low costs and have the necessary protection even if they become uninsurable.
* Policy owners can always convert to a permanent policy at any time while their term life policy is in force, without evidence of insurability.
* Individual packages can be created, combining different types of term life with other types of cash-value life insurance, to cater for specific needs.
* The death proceeds are not subject to federal income and state inheritance taxes.

The answer to this question is quite possibly more complex than you anticipated. First, never let anyone tell you that whole life is a bad idea. People who make a blanket statement like that either have no idea what they are talking about, or simply don’t understand both types of policies. Either way, taking financial planning advice from someone like this is generally a bad idea.

Let me first let you know about some different types of insurance available, I will get into the pros and cons of them after. There is of course term life insurance, but within term you have conventional term and term with a return on premium, where if you do not die during the term of the policy, you get your money back. There is also whole life, and within whole life there are many different types. Some of the whole life policies, you pay until you reach 100 years of age, some you pay for a limited period of time, like a term policy. Finally, there are variable and universal policies which allow flexible payment options and the choice to invest your premium paymentss into a variety of funds and bonds to help grow the value of the policy.

I will only discuss the pros and cons of term and whole life as they are the most common.

Term insurance, you get the most bang for your buck here by being able to purchase more coverage for much less money. Due to the lower cost you can invest some of what the policy would cost otherwise. The real downfall of this type of policy is that if you do live past the term of the policy, usually a maximum of 30 years, you will no longer have any protection for your family. You may have been able to save a few bucks, but if you die after 31 years, what would your family do?

Whole life insurance offers protection no matter when you die, as long as you pay your premiums. This policy allows you to accumulate cash value that you can take loans against and often times the death benefit will increase as the cash value grows. I have a client that purchased $100,000 in coverage, but if interest rates continue the way they are now, this customer will have a policy worth over $300,000 if they survive to the age of 85. The real downfall to this policy is that it does cost more. To obtain a large policy can sometimes be cost prohibitive and it could make the premiums unaffordable if something were to happen to you.

The ideal situation (in the eyes of this insurance professional) is to purchase a mix of policies that meet your entire need and provide coverage both now and down the road. I purchase term policies for myself that would cover my mortgage and provide funds for my children to go to college and life comfortably, after 30 years, when my major expense are completed, my coverage will drop significantly and my family will still have coverage through my whole life policies that will cover expenses like the funeral and any estate taxes that they may need to pay.

My recommendation is to speak with a local insurance professional who can help you determine the right amount of insurance for you, and help youfind the right mix for the right price.

It depends on your income and what you can afford. Term is cheapest and gives you more insurance for your dollar.

Whole life and Universal life are most expensive and you get less insurance.